As exclusive contracts for the iPhone begin to expire throughout Europe, sales of Apple's handset have increased dramatically thanks to expansion to multiple carriers.

In the U.K., carrier Orange recently began selling the iPhone, after the exclusive contract with O2 expired. According to MarketWatch, the company sold 30,000 handsets in its first day of availability. Competing carrier Vodafone is also set to sell the iPhone in early 2010.

If the success of multiple carriers in France is any indication, both Vodafone and Orange should have high hopes for Apple's device. Earlier this year, the iPhone went multi-carrier in France after a government ruling nullified Apple's exclusive arrangement with Orange. Since then, it has been estimated that the iPhone has risen to as high as 40 percent market share of all smartphone sales in the nation.

France is now said to be the largest iPhone market for Apple in all of Europe, with 600,000 handsets estimated sold in the third quarter of the 2009 calendar year. That helped Apple sell a total of 7.4 million iPhones during the September frame, good for a 7 percent year-over-year increase.

Some analysts have even higher expectations for the iPhone in the U.K., as it has five major wireless carriers, compared to France's three. The fragmentation means that the iPhone was previously only available to about 29 percent of U.K. subscribers when it was exclusive to O2. Compare that with Orange in France, where Apple had access to about 47 percent of subscribers.

Apple's success with multi-carrier deals has led some to speculate that the Cupertino, Calif., company will not renew its agreement with AT&T in the U.S., set to expire in 2010. Recent rumors have suggested that Apple and Verizon are working towards a third-quarter debut of a CDMA-compatible iPhone next year.

This is how Apple appears to be different from Nokia. I can't say they smelled the crisis on time (what is not that difficult to imagine having in mind skills and virtues of their marketing and sales gang), yet they've chosen right markets.

We mean Apple no harm.

People are lovers, basically. -- Engadget livebloggers at the iPad mini event.

Smart of Apple to not repeat their mistake in the US in Europe as well.

Apple's sole partnership with AT&T was hardly a mistake, far from that. Apple, having no experience in the phone business what-so-ever, needed a test bed, that would give them that experience all the while keeping full control over the hardware. Only AT&T understood the potential of the iPhone and was willing to give Apple what they needed.

Now we are two years further and I believe that Apple learned a tremendous lot during these years. I am even starting to believe that they are comfortable letting go of part of their control, i.e. go with Verizon, even though I am still not sure whether it is Apple's goal to be number one. They just want to make products that people like, and ultimately, that will bring them there one way or another.

Apple's sole partnership with AT&T was hardly a mistake, far from that. Apple, having no experience in the phone business what-so-ever, needed a test bed, that would give them that experience all the while keeping full control over the hardware. Only AT&T understood the potential of the iPhone and was willing to give Apple what they needed.

Now we are two years further and I believe that Apple learned a tremendous lot during these years. I am even starting to believe that they are comfortable letting go of part of their control, i.e. go with Verizon, even though I am still not sure whether it is Apple's goal to be number one. They just want to make products that people like, and ultimately, that will bring them there one way or another.

Exactly.

I hope you don't mind if I expand on your points. I might end up restating some of them, though.

It's about unrequited demand. It's a brilliant way of doing things. The creation of buildup, anticipation, to a *possible* move to more carriers.

Exclusivity creates desirability, and in the iPhone's case, creates two years' worth of carriers jockeying for position in order to get their hands on the elusive Holy Grail of smartphones. It keeps consumers who can't have it with the hint, the faintest hope of it coming to other carriers. Keeps them interested. It's the same way with women. Give the man just enough to keep him asking for more - never give too much, too fast. Keep him wanting.

So the iPhone never really becomes "old news." It remains something in demand and special. Its rarity feeds into its mystique. It's as big and new and fresh now as it was on release day.

Further, limiting it to just one carrier for the time being allows (or allowed) Apple to test its powers over the typical carrier - how far it can push, and to what degree Apple is beholden to their policies. It also shows Apple just how desirable the iPhone is. How many people can they get to switch carriers just for the iPhone? It's a great way of measuring the pulse of the market with respect to your product's desirabilty. It also creates the impression that other carriers can "make a name" for themselves with the iPhone. Exclusivity = desirability.

It also demonstrates that Apple doesn't "need" other carriers . . . the carriers need Apple. It's Apple saying "we don't need you - we're already shaking up the industry and setting records with only AT&T. But we might *let* you have the iPhone, because it is a privilege."

Masterful.

One thing to keep in mind: Apple always has a powerful, well-thought out strategy behind everything they do. They are fully aware of the consequences of limiting it to just one carrier. But they are also aware of the benefits.

Apple's success with multi-carrier deals has led some to speculate that the Cupertino, Calif., company will not renew its agreement with AT&T in the U.S.

Where is Apple located again? I never would have known from any of the articles posted on AI. Cupertino's population is just over 50K. How about San Jose, Silicon Valley, near San Francisco, California, US or no localizer at all.

Where is Apple located again? I never would have known from any of the articles posted on AI. Cupertino's population is just over 50K. How about San Jose, Silicon Valley, near San Francisco, California, US or no localizer at all.

It's funny, blogs like AI talk enthusiastically about the end of exclusivity in places like France and UK, and they don't know that in Italy, for instance, the iPhone is being sold by two major carriers from the get-go and by a third one from last July. That means 3 out of 4 carriers with the iPhone, you guys, and the fourth major carrier is expected to sell the iPhone in early 2010. That equals to 100% of customers, well above the measly, but good anyway, 49% in France.

or more succinctly: 48+ sovereign nations, each with their own laws and regulations for telecommunications carriers and device manufacturers. This fact alone makes "making the same "mistake they made in the US" highly unlikely, and frankly a PITA to deal with all these regulatory bodies.

The issue here in the US, was that the laissez faire approach that the FCC took towards the build out of the wireless carrier infrastructure allowed Verizon and Sprint to set-up unique bandwidth and carrier technologies (especially compared to the rest of the world and ATT/Cingular/T-Mobile) that specifically precluded migrating from other carriers into their network or vice versa. If you wanted to change you have to buy a brand-new phone specific to that carrier, or a more expensive "universal" phone that had the necessary multi-band chipset (and very poor battery life) to allow moving from GSM to CDMA. The advantage that Verizon and Sprint wanted out of CDMA was that they could distribute cell towers more economically as CDMA technically has no cell size limit. That and the industry labeled CDMA as a 3rd generation or 3G technology. The trade off is slower data speeds and until recently no ability to use voice and data at the same time. That's why Verizon can have such a saturated coverage map, and why the infrastructure costs for ATT/T-Mobile are much higher, as well as the slower distribution of cell infrastructure to expand the GSM 3G services.

It's funny, blogs like AI talk enthusiastically about the end of exclusivity in places like France and UK, and they don't know that in Italy, for instance, the iPhone is being sold by two major carriers from the get-go and by a third one from last July.
[]
I just wonder why

Continuing what youve ben doing from the start is not news. Changing it is news.

Dick Applebaum on whether the iPad is a personal computer: "BTW, I am posting this from my iPad pc while sitting on the throne... personal enough for you?"

It's funny, blogs like AI talk enthusiastically about the end of exclusivity in places like France and UK, and they don't know that in Italy, for instance, the iPhone is being sold by two major carriers from the get-go and by a third one from last July. That means 3 out of 4 carriers with the iPhone, you guys, and the fourth major carrier is expected to sell the iPhone in early 2010. That equals to 100% of customers, well above the measly, but good anyway, 49% in France.

I just wonder why...

Italians always have the coolest phones whenever I've been there- now I see why.

Continuing what youve ben doing from the start is not news. Changing it is news.

That's a good point.

But take this: sales were very good before and the phone was easily available. Right now with the third carrier it's darn hard to find an iPhone almost everywhere, they sell like hotcakes and a weekly shipment from Apple is done in a matter of hours, no joke. That's changing too.

Every consumer I know that was tied into a contract with Bell or Telus immediately upgraded their phones. They used to be everywhere, now they're EVERYWHERE.

Unless Android works out, and it hasn't so far, this is increasingly looking like the iPod dominance all over again.

I am surprised how strong vendor lock-in is with these carriers. I switched carriers to get the phone, but I guess my usage makes that a possibility that other's don't have. I'm even more surprised to learn it's so strong in France, where I was led to believe the lock-in was much less.

It was a brilliant move because AT&T gave Steve Jobs a kick back to be the exclusive carrier, which he promptly spent on his new liver.

Now that he is healthy (live long and prosper Steve-O) he no longer needs the extra money and can now give me the choice to pick the best carrier for the area that I live in. I would choose a 64 gig Verizon iPhone. Not because Verizon is better, just because they are better for me.

If it was so great they would have renewed the contract. Also Apple attempted to go with Verizon first. There was nothing brillant about going with ATT, their network is poor and they were Apple second choice.

If it was so great they would have renewed the contract. Also Apple attempted to go with Verizon first. There was nothing brillant about going with ATT, their network is poor and they were Apple second choice.

1) They did renew the AT&T contract once already.

2) There is a word from Verizon that Apple sought them out first but its natural in negotiations to court the opponent of the team you wish to side with in order to gain more favour. With Apples history of building as a little product as possible there is nothing that says they wanted to build a CDMA phone for the US and a GSM phone for the rest of the world.

3) Verizon is too much like Apple in many ways. They dont play well with others. They want to control and bully so its unlikely that Apple would ever seriously considered them back in 2005 even if they did have a GSM network. Apple needed leverage in order to make the iPhone and its ecosystem a certain way.

4) AT&T and GSM are poor in some regards and Verizon and CDMA are poor in some regards. Each has their pros and cons.

Quote:

Originally Posted by obsidi4n

That's a good point.

But take this: sales were very good before and the phone was easily available. Right now with the third carrier it's darn hard to find an iPhone almost everywhere, they sell like hotcakes and a weekly shipment from Apple is done in a matter of hours, no joke. That's changing too.

There was a report that the iPhone was is short supply with Italy seemingly taking the brunt of it. The US seemed to be in good supply but other countries werent. At the iPod Special Event I think they stated that they production was being ramped up. Carrier exclusivity has its place with new product. I hope that another carrier can get the device in the states if only to alleviate the amount of data usage on AT&Ts network.

Quote:

Originally Posted by Jerseymac

It was a brilliant move because AT&T gave Steve Jobs a kick back to be the exclusive carrier, which he promptly spent on his new liver.

You really think that Apple singed exclusivity agreements with AT&T in 2005 so Jobs could get a liver in 2009? I think you just took Teckstuds crown.

Dick Applebaum on whether the iPad is a personal computer: "BTW, I am posting this from my iPad pc while sitting on the throne... personal enough for you?"

Carrier exclusivity was only brilliant in that it may have generated new contracts for AT&T and produced some sort of kick-back for Apple.

It wasn't successful, however, in spreading the adoption of the device and, therefore, on the whole, muffled the potential of the iPhone itself.

The self-stifling of technological progress via the creation of such vertical monopolies is precisely why the DMCA exemption for carrier unlocking exists, which is why I am so baffled as to why so many people here loathe iPhone unlockers...

The issue here in the US, was that the laissez faire approach that the FCC took towards the build out of the wireless carrier infrastructure allowed Verizon and Sprint to set-up unique bandwidth and carrier technologies (especially compared to the rest of the world and ATT/Cingular/T-Mobile) that specifically precluded migrating from other carriers into their network or vice versa. If you wanted to change you have to buy a brand-new phone specific to that carrier, or a more expensive "universal" phone that had the necessary multi-band chipset (and very poor battery life) to allow moving from GSM to CDMA. The advantage that Verizon and Sprint wanted out of CDMA was that they could distribute cell towers more economically as CDMA technically has no cell size limit. That and the industry labeled CDMA as a 3rd generation or 3G technology. The trade off is slower data speeds and until recently no ability to use voice and data at the same time. That's why Verizon can have such a saturated coverage map, and why the infrastructure costs for ATT/T-Mobile are much higher, as well as the slower distribution of cell infrastructure to expand the GSM 3G services.

No, you have it completely wrong.

European countries have been auctioning their spectrum with a completely technology neutral license in the last 5 years.

European carriers don't believe in ETF --- you have to pay the rest of the contract off before you move to the new carrier. Much better for the consumer with the American way to pay pro-rated ETF, hop to the new carrier and they give you a free phone when you sign a 2 year contract.

Infrastructure cost is higher for Verizon and Sprint --- because there is no economies of scale in the CDMA world.

Why those France numbers are so high--I lived in France until October of this year for a year and a half and I had an iPhone with Orange even before the court decree making it possible for the other 2 carriers SFR and Bouygues to get it. Even when it was an Orange exclusive the cost of ownership was a fraction of that in the US. I got the iPhone 3G 8gig back in March for only €99 when it was selling for $199 in the US. The 16G version was €199 when it was $299 in the US. And this is as an Orange exclusive!

Now also, the cheapest possible plan in France over a 2 year contract was €39 which included the unlimited data AND unlimited texts already included! Talk time is miserly but all incoming calls are free which makes up for it. Compare that to AT&T and in order to get the equivalent I got in France I'd have to pay $90 a month if I wanted the same unlimited text plan--and for 90 bucks I would not be getting my money's worth because the service is so poor. The only places in Paris I didn't get a working 3G connection was in the metro where it always switched to EDGE. Can't say the same for AT&T.

Now for the 3GS among the three carriers the 16GB phone is €149 and the 32GB phone is €179(!!!!)

The plans also basically remain the same at €39 for the cheapest.

That's why the iPhone is so popular in France because you aren't being charged an arm and a leg for the phone itself and for the plans. Opening up to more carriers doesn't necessarily mean downward price pressure in the US, most likely Verizon would charge the same high rate, but at least people would have a choice as to what carrier to use and which one works for them the best in their area--not something available now. And that is always good for the consumer.

Where is Apple located again? I never would have known from any of the articles posted on AI. Cupertino's population is just over 50K. How about San Jose, Silicon Valley, near San Francisco, California, US or no localizer at all.

It's funny, blogs like AI talk enthusiastically about the end of exclusivity in places like France and UK, and they don't know that in Italy, for instance, the iPhone is being sold by two major carriers from the get-go and by a third one from last July. That means 3 out of 4 carriers with the iPhone, you guys, and the fourth major carrier is expected to sell the iPhone in early 2010. That equals to 100% of customers, well above the measly, but good anyway, 49% in France.

I just wonder why...

That's true! AI should have a news article at least weekly about how everything in Italy remains as it was first reported. Very good point.

It was a brilliant move because AT&T gave Steve Jobs a kick back to be the exclusive carrier, which he promptly spent on his new liver.

Now that he is healthy (live long and prosper Steve-O) he no longer needs the extra money and can now give me the choice to pick the best carrier for the area that I live in. I would choose a 64 gig Verizon iPhone. Not because Verizon is better, just because they are better for me.

Everyone should have the choice.

Resenting Apple for being profitable, and in particular imagining that those profits go directly to Jobs, is foolish. Moreover, an iPhone on AT&T costs pretty much what a Droid on Verizon does, so whatever monies you fear Steve is squandering on his health are not coming out of your pocket.

You getting just what you want on the carrier you want is not an inalienable right, or some kind of moral imperative. Apple isn't obliged to do anything at all, in particular, beyond what they think best suits their business interests.

They spoke of the sayings and doings of their commander, the grand duke, and told stories of his kindness and irascibility.

But take this: sales were very good before and the phone was easily available. Right now with the third carrier it's darn hard to find an iPhone almost everywhere, they sell like hotcakes and a weekly shipment from Apple is done in a matter of hours, no joke. That's changing too.

Sounds to me like sales went from very good to great. Is that supposed to be a problem?

Because the France numbers are a combination of new iphone launch (causing the numbers to spike) and the actual study said "VALUE MARKET SHARE" --- which means completely different thing than actual market share.

2 years, in my opinion, would have been a much better choice, to coincide with a user contract.

If we go by the rumour that the contract was 2 years with a 1 year extension by Apple to drop profit sharing would then end it at exactly 2 years after the 3G launched. The original iPhone is a moot point here.

Quote:

Right now the carriers are not competing very well and we customers are getting stuck with the high bills every month.

My bill is lower than it used to be before the iPhone hit. Unlimited data is only $30/month and I have a real web browser and real apps to make it more useful.

Dick Applebaum on whether the iPad is a personal computer: "BTW, I am posting this from my iPad pc while sitting on the throne... personal enough for you?"

Carrier exclusivity was only brilliant in that it may have generated new contracts for AT&T and produced some sort of kick-back for Apple.

It wasn't successful, however, in spreading the adoption of the device and, therefore, on the whole, muffled the potential of the iPhone itself.
-Clive

In order for that to be true it is necessary to prove that Apple could have sold more iPhones than it did.

From all indications, there are no iPhones sitting on store shelves waiting to be sold. Thus, the iPhones were sold to different people, and those people were in different situations (switching to ATT rather than staying with VZ) but in the end, Apple sold all the iPhones it could make, and no matter how much it tried to ramp production, product remained and remains sold out and hard to find. So no, being exclusive to ATT didn't hamper adoption of the device. Verizon users will get their chance.

Carrier exclusivity was only brilliant in that it may have generated new contracts for AT&T and produced some sort of kick-back for Apple.

It wasn't successful, however, in spreading the adoption of the device and, therefore, on the whole, muffled the potential of the iPhone itself.

The self-stifling of technological progress via the creation of such vertical monopolies is precisely why the DMCA exemption for carrier unlocking exists, which is why I am so baffled as to why so many people here loathe iPhone unlockers...

-Clive

The US cell market is very unusual, in that the two major carriers have incompatible systems, and one of those carriers has (or at least had) a very heavy handed approach to mucking with the handsets they carry.

Apple has followed a pretty clear plan globally, using single carrier rollouts to establish their presence, and adding carriers later (which seems to be pretty standard procedure for the industry).

That hasn't happened yet in the US because of the first point, but it hardly entails a "vertical monopoly." In the big scheme of things, the US market will come to be the lesser part of the iPhone's sales and what Apple has or has not done here will not be very important for the continued growth of their phone business.

You'll note that when it comes to PC sales, Apple skeptics are always quick to point out their miniscule global market share, compared to their US penetration, but for the iPhone for some reason the domestic market and strategies are seen as completely defining the platform.

They spoke of the sayings and doings of their commander, the grand duke, and told stories of his kindness and irascibility.

In order for that to be true it is necessary to prove that Apple could have sold more iPhones than it did.

From all indications, there are no iPhones sitting on store shelves waiting to be sold. Thus, the iPhones were sold to different people, and those people were in different situations (switching to ATT rather than staying with VZ) but in the end, Apple sold all the iPhones it could make, and no matter how much it tried to ramp production, product remained and remains sold out and hard to find. So no, being exclusive to ATT didn't hamper adoption of the device. Verizon users will get their chance.

I think the volumes of interest in unlocking is evidence you're looking for. If people were satisfied with the carrier selection, why would so many people unlock? AI reported last year that up to 40% of iPhones in Europe were unlocked... That was, of course, before Apple killed iTunes activation in favor of in-store only activation.

The US cell market is very unusual, in that the two major carriers have incompatible systems, and one of those carriers has (or at least had) a very heavy handed approach to mucking with the handsets they carry.

Apple has followed a pretty clear plan globally, using single carrier rollouts to establish their presence, and adding carriers later (which seems to be pretty standard procedure for the industry).

That hasn't happened yet in the US because of the first point, but it hardly entails a "vertical monopoly." In the big scheme of things, the US market will come to be the lesser part of the iPhone's sales and what Apple has or has not done here will not be very important for the continued growth of their phone business.

You'll note that when it comes to PC sales, Apple skeptics are always quick to point out their miniscule global market share, compared to their US penetration, but for the iPhone for some reason the domestic market and strategies are seen as completely defining the platform.

Well you're certainly right about the incompatible systems, and I don't have any complaints about the short-term single-carrier roll-outs, but what's left to be explained is the absurdly long duration of their U.S. AT&T exclusivity.

Or perhaps Apple knows we Americans won't comparison shop, nor abstain from a product with whose terms of use we do not like and therefore decided to take advantage of our idiotic weakness.

I think the volumes of interest in unlocking is evidence you're looking for. If people were satisfied with the carrier selection, why would so many people unlock? AI reported last year that up to 40% of iPhones in Europe were unlocked... That was, of course, before Apple killed iTunes activation in favor of in-store only activation.

If that's not evidence enough, I don't know what is...

-Clive

That was early in the 2G iphone world when there were only UK, France and Germany selling the iphone and there were a lot of "missing" American iphones that were unlocked and exported.

It has nothing to do with whether consumers are satisfied with their carrier selection because the only way an Italian consumer could get an iphone in early 2008 was to buy an unlocked iphone because Apple hasn't launched the iphone in Italy yet.